With the title of this monograph we want to define all those factors that prevent, hinder the implementation of Continuous Improvement Systems, or reduce the impact that their implementation should have on the evolution, profitability and competitiveness of companies.
We consider that the factors referred to are valid for the implementation of any other system, be it Total Quality, Productivity, or Customer Satisfaction, and it should be noted that these systems are necessary in order to make the Improvement feasible Keep going.
The most common and important factors will be described, as well as the most effective techniques, methods, policies and strategies to overcome them.
Before we must define what is a Continuous Improvement System. We must understand as such the set of tools, methods, strategies, policies, plans and instruments that combined harmoniously within a management philosophy allow to consistently achieve new and better levels in terms of quality, costs, productivity, customer service, levels of satisfaction and delivery time, thus allowing to increase the profitability indexes and added value of the organization.
External and Internal Factors
Before listing the various factors, we must clearly distinguish between external and internal factors, the former being those that affect the environment of the corporation and over which it has no greater power to modify. While the inmates are those on which the managers and officials of the company can direct or exercise a specific policy.
Internal factors
Among the internal factors that prevent either the implementation or the achievement of the results sought through Continuous Improvement we have:
- Lack of awareness on the part of the Executives. Lack of firm decision and support on the part of the Executives or High Management. Lack of leadership Lack of awareness and support of the Middle Management Lack of awareness and support of the rest of the staff Absence or deficiency in the Plans of implementation and start-up Lack of training and training Lack of budget items for its application. Lack of a Cultural Audit and Diagnosis of the Situation. Lack of adaptation of systems and methods to the characteristics of the environment and the company. Lack of application of Organizational Development. Lack of good information systems, monitoring and control of results. Lack of technical knowledge and experience on the part of External Consultants. Technical lack of knowledge or partial knowledge.Lack of teamwork and participation policy. Absence of a system of rewards and punishments, or motivation policies.
External factors
Of the most important external factors these can be mentioned:
- Lack of long-term economic policies by the State. Lack of a work ethic with objectives in quality, productivity and continuous improvement by the population. Lack of a culture and labor discipline. Economic system that does not reward improvement and productivity. Absence of prizes and punishments. Legal institutions that do not adequately protect property rights, especially intellectual property rights. Lack of promotion of Research and Development by the State. Absence of an educational policy aimed at training individuals with technical knowledge, scientists and work discipline. High state participation in the economy. High levels of external protectionism. High degrees of regulation or regulation of activities.System with strong pressure on capital and lack of promotion of private initiative. Lack of investment in public works Lack of good security systems Lack of investment in health
Regarding these external factors, although a company may not have the capacity to change, business groups may have it through associations and foundations aimed at the dissemination of ideas, pressure groups and dissemination actions.
Lack of awareness by managers
Los Directivos deben tomar claramente conciencia de que seguir compitiendo en los actuales mercados globalizados implica la necesidad de mejorar día a día sus performance en materia de calidad, costos, plazos de entrega, servicios al cliente y satisfacción al consumidor. De lo contrario no sólo perderá sus posibilidades de exportación, sino incluso irá perdiendo su cuota de mercado doméstico. Ello es algo por lo cual han atravesado los mismísimos directivos de las grandes corporaciones americanas ante el avance de las industrias niponas. Creían que ofreciendo sus superautos tal como lo venían haciendo desde hacía varias décadas ninguna otra empresa podría hacerles sombra en su propio territorio. Creían conocer a la perfección los gustos y necesidades del público americano. Pero esas creencias quedaron totalmente superadas por los hechos. Estos mostraron que los Directivos de las empresas de un país asiático tenían mucho mejor en claro que ofrecer y como hacerlo.
The way to overcome this problem of awareness is by learning to manage change at a time when it has become a high-speed product of the advancement of computing and communications, which has been called the Third Wave. A time in which the lack of knowledge will be lethal for companies that do not take due awareness of the changes and the need for such reason to improve unceasingly day after day.
Lack of firm decision and support from the Directors or Senior Management. Lack of leadership.
Being aware of the changes and therefore of the need, yes or yes, to bet on the quality and satisfaction of consumers is not everything. It is also necessary to take a firm decision, and provide unrestricted support to the implementation and achievement of Continuous Improvement. Words must be accompanied by deeds, and strong and firm leadership is required for this. Company personnel must clearly see that these are not simple inventions, but rather that there is a firm decision to establish a system that will reduce failures, costs, delivery times every day, and increase the added value for the client.
It is necessary that continuous improvement is present in all board meetings, that all issues revolve around it, and there must also be communication that allows all staff to be kept up to date on the decisions and actions undertaken for this purpose.. It is essential that managers lead by example, and for this they must be generators of quality, productivity and avoid all kinds of waste and waste that lead to lower profitability and benefits for the company.
Lack of awareness and support from Middle Management
The Middle Management has a fundamental importance in the implementation of any new system. As long as the members of that management level are threatened by the changes, they can become a powerful resistance to change, something that must be avoided at all costs. For this, good communication is essential, firstly, and secondly, showing them what the patterns of behavior must be that they must assimilate and respect as a result of the changes that the organizational structure of the company requires, from which new functions and responsibilities. Failure to adopt or take due account of the importance of this decision-making level may simply imply the failure of the new system, something very common especially in state organizations.
Lack of awareness and support from other staff
There is no commitment without participation, and to achieve that participation by the staff, it is necessary to maintain fluid communication, make clear the reasons and motives for the changes, the rewards and punishments, but above all, make them participate as a minimum at the operational level, and as far as possible in tactical fundamental decisions. This will generate some delays, but will facilitate faster and more effective implementation.
Absence or deficiency in the implementation and start-up plans
"Whoever does not plan, plans for disaster", this phrase says it all, and even more so when it comes to implementing a new system. It is necessary to clearly define a strategic plan that defines the fundamental values, mission, vision and strategies of the company. In this way, the system to be implemented and the steps for its implementation must avoid opposing the values and missions of the company, and must fit within the planned strategic framework. Then the long and short term plans will allow to define shorter-range goals, within which the goals must be clearly defined in terms of numbers and deadlines to be achieved both in terms of the implementation of the plan and the achievement of its objectives.
Planning involves determining where you are at the moment, where you want to go, what to do to get from the current situation to the desired one, and what resources will be required to do so. In addition, action alternatives should be established in the event of deviations or special situations (alternative plans).
Lack of training and coaching.
Failure to properly train the different levels of the organization in management techniques, as well as measurement, control, problem solving and decision-making, will prevent the implementation of the Continuous Improvement System. In addition, for it to produce positive results regularly and systematically, a continuous training plan is required, which must be considered within a Quick Learning Organization methodology. Not only is it necessary to train, but staff must also be trained to handle new instruments, be they administrative, computer, technological or methodological. Wanting to put into operation something that is not well understood, or misunderstood, will not give positive results for the company.
Lack of budget items for its application
Implementing a system requires certain minimum expenses in terms of training, coaching, software and consulting. To do this, items must be assigned in the Budget that allow such expenditures to be met in a fluid manner, which should not be considered under any point of view as expenses, but as investments necessary for the future development of the corporation.
Wanting to implement a new system and not allocating items to put them into practice will imply not only not being able to materialize it, but it will also give a terrible message to the rest of the organization regarding the real intentions of the Company's Board of Directors.
Lack of a Cultural Audit and Diagnosis of the Situation
Prior to any decision regarding the system to be implemented, the culture of the company must be audited to recognize its patterns so that the changes to be made and the methods to be implemented do not conflict. The changes that must be made in the company culture to make possible the implementation of new instruments and methods must also be recognized. What can never be left aside is that either the instruments are adapted, or the necessary changes are made in the culture. In principle, it is easier to adapt the tools because the culture requires more time, but it must also be modified yes or yes to make it compatible with the new realities of the market, otherwise the organization runs the risk of disappearing like dinosaurs.
The second aspect to consider is the need for a deep diagnosis that allows us to know for sure where we are and what indicators should be improved, and in what way.
It is necessary to know where the main operational shortcomings are, in which activities and processes the greatest obstacles are registered, and in this way be able to plan precisely what changes to make and in what way.
Lack of adaptation of systems and methods to the characteristics of the environment and the company. Lack of application of Organizational Development.
Directly related to the previous point is the failure to adapt the systems and methods to both the characteristics of the environment of the company and the company itself.
Organizational Development must be used as a fundamental tool to achieve a change in the productivity and quality levels of the company in the long term.
Organizational Development is the systematic application of behavioral science knowledge at various levels for the effective realization of planned change. Its objectives are a higher quality of working life, productivity, adaptability and efficiency. It pursues the use of behavioral knowledge to modify opinions, attitudes, values, strategies, structures and practices so that the organization can better adapt to competitive actions, technological advances and the accelerated rate of other changes in the environment.
Lack of good information systems, monitoring and control of results
Implementing a new system implies the need to plan what results are expected within certain deadlines. For this, it is essential to have an information system that in time, precision and at a low cost allows monitoring two aspects:
- The results of the implementation and its deviations The results of the operation of the system itself.
The system should be like a radar that alerts not only to internal deviations, but also to external changes, whether these are a threat or opportunity for the company.
Lack of technical knowledge and experience by External Consultants
Implementing a new system requires the collaboration and advice of external consultants. The research capabilities that they possess, their levels of creativity, their technical-scientific knowledge and accumulated experience are essential when it comes to selecting those people who will advise the company on the implementation and implementation of new tools and instruments., methods, processes and systems.
Technical lack of knowledge or partial knowledge
Linked to training and coaching within or outside the same company, there is a need to have firm knowledge regarding each of the techniques, tools and methods to be applied. Shallow or misrepresented knowledge will lead to wasted time, wasted resources, misunderstandings, and lack of results.
Lack of teamwork and a participation policy
In the new way of managing companies, teamwork is essential, as is the participation policy by which it is personal, not only making available to the company its hands, but also its brain. A Continuous Improvement System requires the participation and teamwork of all its staff. Teamwork is no longer an option but an obligation on the part of company personnel. When speaking of teamwork, reference is made to both special task groups and the work of the organization as a whole.
Absence of a system of rewards and punishments, or motivation policies.
It must be clear from the beginning that those who do not do things properly, who do not do their best at all times will not receive the same awards as those who put everything into making the company competitive and successful. If this is not done, the personnel who act positively become discouraged and all end up in a negative attitude towards the system and the company.
When motivating, it is essential to involve the staff in the economic achievements obtained in the improvement process. If the company generates benefits as a result of continuous improvements in its productivity levels and the personnel who contributed to it are not partakers of such benefits in due proportion, sooner or later they will stop supporting the improvement plans and actions.
Lack of long-term economic policies by the State
On the one hand, planning requires it, on the other hand, being able to measure results, and lastly, it is essential to motivate managers and staff. An erratic economic policy, where it is not known what will happen tomorrow or a year from now, will not encourage investment, nor the implementation of actions aimed at systematically improving the indices as the current world economy requires. This is undoubtedly a fundamental factor when determining the level of competitiveness of each country, and therefore attracting both domestic and foreign investment.
Lack of a work ethic with objectives in quality, productivity and continuous improvement by the population. Lack of a culture and labor discipline.
Wanting to give your best to improve yourself and the organization for which you work. Wanting to do their best to offer top quality products to the market and always and everywhere satisfy consumers is what differentiates societies that continue to grow, progress and be competitive, from those that only want to progress at the expense of consumers and taxpayers. In the entire world, on a commercial level, there is only one reality and it consists in generating the greatest added value for the client, companies that do not understand it are and will be in serious trouble. The State must promote Quality through prizes as in Japan is done with the Deming Prizes, it must be promoted through public education, and by clear signs of interest in protecting consumers.
Economic system that does not reward improvement and productivity. Absence of awards and punishments.
When a tax system with progressive income taxes discourages continuous improvement that leads to higher levels of productivity and therefore profits, the system is being corrupted in such a way as to give the message "be incompetent and in this way you will pay less tax".
A tax system created only for tax collection and not to promote production and productivity, and a modeled financial system for speculation are hyper-negative for continuous improvement. The tax and financial system must not only avoid disincentives, but must also promote and protect everything that leads to higher levels of productivity. The income levels of the population as a whole depend on the level of productivity, if this is distorted by State policy it will generate a lot of increasing unproductive public employees living at the expense of the decreasing productive sectors.
Legal institutions that do not adequately protect property rights, and especially intellectual property rights.
With this we are making reference to both the legal framework and the action of justice. An inoperative State when defending private property, labor rights, environmental protection, among others, will give free rein so that instead of worrying about generating benefits through continuous improvement, the improvement of profitability polluting the environment, not respecting the rights of workers, nor those of consumers and investors, among others.
Lack of State Research and Development promotion
The costs of researching and developing new products are long-term and costly, so the State must participate in it by promoting it through universities, research centers, foundations, the tax system and financial support at low rates and long periods of He recovered.
Absence of an educational policy aimed at training individuals with technical, scientific and work discipline knowledge.
If the State does not invest in education, it is the companies that will have to face this investment, and if it is too expensive they will look for better places to carry out their ventures. But not only does the technical knowledge itself count, but the State, through education, fosters a love of study, progress, the consumer, quality, respect for property, discipline, teamwork, to investigate and respect in the workplace. A person without discipline cannot be part of the current schools where instruments and machines of the highest value are operated.
High participation of the State in the economy.
Various studies carried out in different countries have shown that the greater the state's participation in the economy, the more distorted market signals are and the less scarce resources are allocated.
High levels of external protectionism
The absence of competition leads companies to dispense with continuous improvement as a way to increase their competitiveness in order to deal with the best world producers.
Countries that for long periods of time were subject to protectionist policies saw their citizens' living standards drop, as they must pay more for lower quality products than those offered internationally. On the other hand, a non-competitive industry lacks the capacity to place products abroad, which means there is no currency to acquire the best products offered by companies abroad. It is a vicious circle that engenders high levels of inflation, strong fighting over income and a continuous decline in the quality of both goods and services.
High degrees of regulation or regulation of activities
Directly linked to the previous point is the situation in which everything is hyper-regulated. This results in enormous bureaucratic costs for companies, and also a lack of interest in continuous improvement. Why improve if you have a monopoly granted by the State.
System with strong pressure on capital and lack of promotion of private initiative.
When all political activities make patronage a survival system for politicians and public employees, or recipients of subsidies, when companies are regulated and then subsidies are granted to cover losses, there is nothing else to do but encourage long-term unproductiveness with all the consequences that this entails.
Lack of investment in public works
It is necessary to have communication systems that allow both rapid and economic transportation of merchandise, as well as means of telephone, satellite communication, production and distribution of safe energy at international costs. The best continuous improvement systems are useless in the face of continuous power supply cuts or the lack of good transport routes.
Lack of good security systems
Losing due to lack of security the achievements obtained through continuous and successive improvement plans produce a strong demotivating effect on both businessmen and operators. Only in an environment with a minimum level of security will staff be able to focus day by day with complete peace of mind on improving their performance.
Lack of investment in health
In order for the personnel to leave their best in the company every day in pursuit of the objectives outlined in the improvement plans, it is essential that they have an optimal state of health, which must be guaranteed by the State. Although the company must protect its personnel internally, the State under its police power must ensure faithful compliance with the standards that companies must comply with in terms of safety and health.
Conclusions
There are many duties that company managers must perform in order for the continuous improvement plans to come to fruition, but there is also much that the State must do to promote continuous improvement in order to increase productivity and the quality of products and services from all sectors of the economy. Latin American businessmen, like governments, have been indebted for a long time in this matter, both to their peoples and to history. In the absence of a change in behavior, this region of the globe will continue to move away from the other economic blocks.
AUTHOR: Dr. Mauricio Lefcovich
Consultant in Operations Management and Business Strategy
Specialist in Quality, Productivity, Continuous Improvement, Cost Reduction and Consumer Satisfaction.
E-mail: [email protected]
FACTORS CONTRARY TO CONTINUOUS IMPROVEMENT AND WHAT TO DO TO OVERCOME THEM
Contributed by: Mauricio León Lefcovich - [email protected]
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